First Pacific Company Limited — M&A Activity 2000

Jan 17, 2000

Listed Company Information

SUN HUNG KAI CO<0086> - Announcement The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. SUN HUNG KAI & CO. LIMITED (Incorporated in Hong Kong with limited liability) ANNOUNCEMENT Reference is made to the announcement of Sun Hung Kai & Co. Limited ("Company") dated 16 December 1999 in connection with the delay in despatch of a circular ("Circular") containing information on a conditional sale and purchase agreement dated 24 November 1999 ("Major Transaction") for the sale of 770 million shares of HK$0.20 each ("Sale Shares") (representing 19.77% of the issued share capital) in Tian An China Investments Company Limited ("Tian An"). On 15 January 2000, the Company has despatched to its shareholders the Circular, together with a notice to convene an extraordinary general meeting of the Company to be held on 2 February 2000 ("EGM"). This announcement is made for the purpose of informing the public of certain financial information contained in the Circular and in accordance with The Rules Governing the Listing of Securities on the Stock Exchange ("Listing Rules"). On 15 January 2000, the Company has despatched to its shareholders the Circular, together with a notice to convene the EGM. In compliance with the Listing Rules, the Circular contains a statement of pro forma adjusted unaudited consolidated net tangible assets of the Company and its subsidiaries ("Group") which was prepared based on the shareholders' funds of the Group as stated in the audited consolidated financial statements of the Group as at 31 December 1998 and adjusted as follows: HK$'000 HK$'000 Shareholders' funds based on the audited balance sheet of the Group as at 31 December 1998 3,540,834 Add: Capital reserves on acquisition of associated companies 311,421 Less: Share of goodwill of an associated company (414 ) Audited consolidated net tangible assets as at 31 December 1998 3,851,841 Unaudited consolidated profit attributable to shareholders for the six months ended 30 June 1999 per published interim report 55,555 Adjustment of the Group's additional holding of 891,368,718 shares in Tian An of HK$0.20 each ("Tian An Shares") as marketable securities 36,802 Adjustment for reclassification of Tian An from subsidiary to associated company (Note 1) (7,320 ) Interim results restated for the six months ended 30 June 1999 85,037 1999 Interim dividend paid (11,625 ) Revaluation deficit of long-term equity investments as at 31 December 1999 (328,886 ) Unrealised profit of 891,368,718 Tian An Shares less provision for taxation from 1 July 1999 to 31 December 1999 63,633 Pro forma adjusted unaudited consolidated net tangible assets before the Major Transaction 3,660,000 Net profit arising from the Major Transaction (Note 2) 139,062 Pro forma adjusted unaudited consolidated net tangible assets after the Major Transaction 3,799,062 Notes: 1. The Company has not formed any permanent intention that Tian An would remain a subsidiary. Accordingly, Tian An was excluded from consolidation as a subsidiary but reclassified as an associated company on the ground of temporary control in the interim results. 2. Net profit arising from the Major Transaction: HK$'000 Consideration of the Sale Shares 423,500 Less: Book value as at 31 December 1999 (257,950) The excess of the consideration over the book value 165,550 Less: Provision for taxation (26,488 ) Net profit arising from the Major Transaction 139,062 This profit will be booked in accordance with generally accepted accounting principles in Hong Kong. The Company has also despatched a circular to the holders of the warrants for subscription of new shares in the Company at any time during the subscription period up to and including 18 February 2000 and, for information only, to its shareholders and the holders of its convertible loan notes issued on 13 January 1998, detailing particulars and arrangements concerning the expiry of the warrants. On behalf of the Board Arthur George Dew Executive Chairman Hong Kong, 15 January 2000